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WINNIPEG, Jan. 29, 2018 /CNW/ – Delta 9 Cannabis Inc. (TSXV:NINE.V – News) (“Delta 9” or the “Company”) is pleased to announce it has entered into a non-binding letter of intent (the “LOI”) with Westleaf Cannabis Inc. (“Westleaf”) to create a strategic partnership for the joint development of a large-scale cannabis production facility located in Southern Alberta (the “Project”).

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Delta 9 Cannabis was the fourth licensed producers in Canada, and the only LP licensed to sell cannabis in Manitoba. The company is now expanding with investment in an Alberta-based operation. (CNW Group/Delta 9 Cannabis Inc.)

Pursuant to the terms of the LOI, Delta 9 and Westleaf will each own a 50 per cent equity interest in the Project. The Project includes the retrofit of an existing building intended to be equipped to produce approximately 4,000 kilograms of premium dried cannabis flower per annum, and an extraction lab for the production of cannabis oil and derivative products. Delta 9 anticipates designating the Project as an expansion facility under its existing Access to Cannabis for Medical Purposes Regulations (“ACMPR”) license. The Project is expected to be operational as early as the third quarter of 2018 and is intended to supply cannabis products to the Alberta medical and recreational markets.

The completion of the Project remains subject to a number of conditions including, among other things: the execution of a definitive, binding agreement between Delta 9 and Westleaf; the parties obtaining the debt and equity financing required to complete the Project; and the completion of due diligence regarding the Project by Delta 9 and Westleaf.

“We are excited about this transformational opportunity,” said Delta 9 CEO John Arbuthnot. “Strategic partnerships with companies such as Westleaf provide Delta 9 with additional production capacity and expansion opportunities into new markets to meet increasing demand as we approach the legalization of recreational cannabis this summer.”

Westleaf President Scott Hurd says the Delta 9 partnership is an important step in his company’s development.

“We are extremely pleased to call Delta 9, one of Canada’s most experienced cannabis cultivators, our partner,” Hurd said. “Collectively, Westleaf and Delta 9 will have large-scale cannabis production facilities that can ably serve the Canadian Prairies (Alberta, Saskatchewan and Manitoba). “Our partnership will allow us to accelerate our time to market and drive synergies through collaboration to bring high quality, safe and consistent cannabis products to our medical and recreational customers.”

The completion of the Project by Delta 9 is also subject to final approval by the TSX Venture Exchange.

About Westleaf Cannabis Inc. Westleaf is a private vertically integrated cannabis company headquartered in Calgary, Alberta. In addition to the Alberta Project, Westleaf is developing a ~200,000 square foot cannabis production facility in Saskatchewan. Westleaf and its affiliates are pursuing retail distribution in both Alberta and Saskatchewan. For more information please contact [email protected] or visit our website at www.westleaf.com

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Disclaimer for Forward-Looking Information

Certain statements in this release are forward-looking statements, which reflect the expectations of management regarding the Company’s future business plans and other matters. Forward-looking statements consist of statements that are not purely historical, including any statements regarding beliefs, plans, expectations or intentions regarding the future. Forward looking statements in this news release include statements relating to: (i) the details and anticipated timing of the completion of the Project; (ii) the licensing of the Project; (iii) sales of cannabis produced by the Project; (iv) conditions required to complete the Project; and (v) the future development plans of Westleaf. Such statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements, including that Delta 9’s currently contemplated expansion and development plans may cease or otherwise change, Delta 9’s production of cannabis may be lower than expected, Delta 9 may not obtain the required approvals from Health Canada, demand for Delta 9’s products may be lower than anticipated, Delta 9’s cost to produce its grow pods may be higher than expected and all other risk factors set forth in the filing statement of Delta 9 dated October 25, 2017 which has been filed on SEDAR. No assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if they do occur, what benefits the Company will obtain from them. Readers are urged to consider these factors carefully in evaluating the forward-looking statements contained in this news release and are cautioned not to place undue reliance on such forward-looking statements, which are qualified in their entirety by these cautionary statements. These forward-looking statements are made as of the date hereof and the Company disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, except as required by applicable securities laws.